ConnectOne Bancorp (NASDAQ:CNOB) and First Foundation (NASDAQ:FFWM) Head-To-Head Survey

First Foundation (NASDAQ:FFWM) and ConnectOne Bancorp (NASDAQ:CNOB) are both small-cap finance companies, but which is the superior business? We will compare the two businesses based on the strength of their dividends, earnings, profitability, valuation, risk, analyst recommendations and institutional ownership.

Analyst Ratings

This is a summary of recent ratings and recommmendations for First Foundation and ConnectOne Bancorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
First Foundation 0 0 0 0 N/A
ConnectOne Bancorp 0 0 1 0 3.00

ConnectOne Bancorp has a consensus price target of $27.00, indicating a potential upside of 7.57%. Given ConnectOne Bancorp’s higher possible upside, analysts plainly believe ConnectOne Bancorp is more favorable than First Foundation.

Earnings & Valuation

This table compares First Foundation and ConnectOne Bancorp’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
First Foundation $243.08 million 3.03 $42.96 million $1.17 14.09
ConnectOne Bancorp $221.87 million 4.00 $60.35 million $2.23 11.26

ConnectOne Bancorp has lower revenue, but higher earnings than First Foundation. ConnectOne Bancorp is trading at a lower price-to-earnings ratio than First Foundation, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

60.1% of First Foundation shares are owned by institutional investors. Comparatively, 62.3% of ConnectOne Bancorp shares are owned by institutional investors. 13.9% of First Foundation shares are owned by insiders. Comparatively, 7.6% of ConnectOne Bancorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Profitability

This table compares First Foundation and ConnectOne Bancorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
First Foundation 19.41% 9.52% 0.90%
ConnectOne Bancorp 26.60% 11.43% 1.31%

Risk & Volatility

First Foundation has a beta of 0.87, meaning that its share price is 13% less volatile than the S&P 500. Comparatively, ConnectOne Bancorp has a beta of 0.98, meaning that its share price is 2% less volatile than the S&P 500.

Dividends

First Foundation pays an annual dividend of $0.20 per share and has a dividend yield of 1.2%. ConnectOne Bancorp pays an annual dividend of $0.36 per share and has a dividend yield of 1.4%. First Foundation pays out 17.1% of its earnings in the form of a dividend. ConnectOne Bancorp pays out 16.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. ConnectOne Bancorp is clearly the better dividend stock, given its higher yield and lower payout ratio.

Summary

ConnectOne Bancorp beats First Foundation on 12 of the 15 factors compared between the two stocks.

First Foundation Company Profile

First Foundation Inc., through its subsidiaries, provides financial services to individuals, businesses, and other organizations in the United States. It operates in two segments, Banking; and Investment Management and Wealth Planning. The company offers a range of bank deposit products, including personal and business checking accounts, savings accounts, interest-bearing negotiable order of withdrawal accounts, money market accounts, and time certificates of deposit; and loan products consisting of multifamily and single family residential real estate loans, commercial real estate loans, and commercial term loans and lines of credit, as well as consumer loans, such as personal installment loans and lines of credit, and home equity lines of credit. It also provides various specialized services comprising trust services, online banking, remote deposit capture services, merchant credit card services, ATM cards, Visa debit cards, and business sweep accounts, as well as insurance brokerage services and equipment financing solutions. In addition, the company offers investment management and financial planning services; treasury management services; advisory and coordination services in the areas of estate planning, retirement planning, and charitable and business ownership issues; and financial, investment, and economic advisory and related services. Further, it provides support services, including the processing and transmission of financial and economic data for charitable organizations. The company operates through a network of 20 branch offices and 2 loan production offices in California, Nevada, and Hawaii. The company was founded in 1990 and is headquartered in Irvine, California.

ConnectOne Bancorp Company Profile

ConnectOne Bancorp, Inc. operates as the bank holding company for ConnectOne Bank, a state chartered bank that provides various commercial banking products and services. The company offers a range of deposit products, including personal and business checking accounts, retirement accounts, money market accounts, and time and savings accounts. It also provides personal and commercial business loans on a secured and unsecured basis; revolving lines of credit; commercial mortgage loans; residential mortgages on primary and secondary residences; home equity loans; bridge loans; and other personal purpose loans. In addition, the company offers credit cards, wire transfers, access to automated teller services, Internet banking, treasury direct, ACH origination, lockbox, mobile banking by phone, safe deposit box, and remote deposit capture services. As of January 24, 2019, the company offered its commercial and consumer banking and lending services and products through its 29 banking offices located in New York and New Jersey. It serves small-to-medium sized businesses, high net worth individuals, professional practices, and consumer and retail clients. The company was formerly known as Center Bancorp, Inc. and changed its name to ConnectOne Bancorp, Inc. in July 2014. ConnectOne Bancorp, Inc. was incorporated in 1982 and is headquartered in Englewood Cliffs, New Jersey.

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